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Don’t Work Overtime to Understand the Department of Labor’s New Rules



By Lukas Clary

Are you sure you’re paying your exempt employees enough? Even if you are right now, you might not be come Dec. 1, 2016.  The U.S. Department of Labor recently announced its long-awaited final rule updating the definitions of most types of exempt employees under federal law. 

While there are several important provisions in the new rule, the most important for employers is the new minimum salary threshold for “white collar” exempt employees—those who are classified as exempt under the executive/managerial, administrative, or professional standards.  Federal law will soon require these employees earn at least $47,476 annually ($913 per week) to qualify for the exemptions.  This marks a significant jump from the previous federal minimum of $23,660 ($455 per week). 

The DOL estimates that more than 4 million workers currently classified as exempt will no longer qualify at their current salaries come Dec. 1. The new salary requirements will particularly impact employers in regions of the country with lower median incomes, and employers in states that have adopted more employee-friendly overtime laws on top of federal law. Employers will have to assess how to manage costs in light of the new laws while keeping up with closing volumes. 

This topic will be addressed at the ALTA Annual Convention on Oct. 6,at 3 p.m. The session will provide a briefing on both federal and state classification rules, a discussion of how title professionals are treated under these rules, provide a method for documenting compliance and defending challenges, and help employers ensure they are in compliance.

Lukas Clary is an associate of Weintraub Tobin. He can be reached at [email protected]. Clary will speak more in depth about this topic during a session titled "Don’t Work Overtime to Understand the Department of Labor’s New Rules" during ALTA's Annual Convention. Click here to register.


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